N.J. Company Sold Bacteria-Laden Ultrasound Gel: Prosecutors

Essex County, NJ – A New Jersey-based pharmaceutical company has pleaded guilty to selling ultrasound gel contaminated with bacteria, authorities said.

Pharmaceutical Innovations Inc., based in Newark, pleaded guilty Wednesday in federal court to two misdemeanor counts of introducing adulterated medical devices into interstate commerce, according to the U.S. Attorney’s Office of New Jersey.

According to prosecutors, a 2014 civil complaint alleged that the company was selling medical devices that the Food and Drug Administration (FDA) had not approved or cleared and that it was violating current good manufacturing practices.

In addition, the complaint alleged that the company failed to take required actions after receiving reports in February of 2012 about “serious injuries associated with its products” – expressly its Other-Sonic Gel - which was used to facilitate ultrasound or other imaging procedures such as sonograms and EKGs.

According to court documents and statements, in February of 2012, a Michigan hospital reported that 16 surgical patients were infected with Pseudomonas aeruginosa, a bacterial pathogen that the CDC says can lead to severe illness and death for people with weakened immune systems.

Prosecutors said that the hospital believed the infections were associated with a particular lot of Pharmaceutical Innovations ultrasound gel, prosecutors stated. A sample of that lot then tested positive for Pseudomonas aeruginosa. A second lot was shipped in April 2012 and found to be contaminated with two types of bacteria, Pseudomonas aeruginosa and Klebsiella oxytoca.

The US. Department of Justice filed a civil suit in October 2014 against Pharmaceutical Innovations and its founder, owner, and longtime president, Gilbert Buchalter. While Buchalter was later dropped from the case, his son, Charles Buchalter, subsequently became company president and was added to the case, prosecutors said.

"Pharmaceutical Innovations shipped defective products that exposed hospital patients to dangerous bacterial contamination," U.S. Attorney Paul Fishman said. "This plea agreement and civil settlement requires Pharmaceutical Innovations to accept responsibility for the contamination and take the necessary steps to prevent it from happening again."

According to its website, Pharmaceutical Innovations received a President's “E Star” Award in 2007 from the U.S. Secretary of Commerce, which recognizes “noteworthy export promotion efforts.”

Federal officials also awarded the company a President's “E” Award in 1992 for “contributing significantly in the effort to increase United States exports.”

PLEA AGREEMENT, CIVIL SETTLEMENT

The Consent Decree of Permanent Injunction requires Pharmaceutical Innovations to submit a detailed compliance plan to FDA within 20 days, and to have outside experts certify in writing by Oct. 31, 2016, that the company meets current good manufacturing practice requirements.

“At the company’s expense, the FDA will then conduct a follow-up inspection,” prosecutors stated in a news release. “For the next three years, Pharmaceutical Innovations must hire outside auditors to conduct and submit detailed audit reports to FDA. In addition, the company will forfeit and pay for the destruction of contaminated gel that the U.S. Marshals Service seized in April of 2012 as part of a seizure and forfeiture case filed by the United States.”

In addition to placing the company on two years of probation, a federal judge ordered the company to pay a criminal fine of $50,000 and to forfeit an additional $50,000, the approximate value of the adulterated gel.

According to prosecutors, in a separate civil settlement also resolved Wednesday, Pharmaceutical Innovations agreed to the forfeiture and destruction of particular gel products that tested exceptionally high for infectious bacteria, and agreed to a permanent injunction that requires independent experts and auditors to conduct regular inspections and certifications at the company's expense.

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